Visit with Warren Buffett Exceeds All Expectations

4.28.07

For 75 Whitman students, their April 20 visit to Omaha, Neb., for an audience with Warren Buffett promised to be an experience of a lifetime. But the reality of the trip, sponsored and organized by the Whitman School’s Ballentine Investment Institute, “exceeded all expectations,” confirms Whitman senior Jordan Barker ’07 BS.

At the core of the visit was a two-hour Q&A session with Mr. Buffett at Berkshire Hathaway headquarters, where Whitman MBA, MS, and undergraduate students were joined by peers from Cornell University. “The questions posed to Mr. Buffett were very business-focused,” notes finance major Ryan Saks ’07 BS. “But for each question, he would take about 15 minutes to answer while relating his remarks to broader aspects of our lives. Even if the question was on something as specific as the Federal Reserve or taxes, he’d find a way to share a life lesson and then circle back to the actual question in a way that was really impressive.” Saks says Buffett’s sincerity was equally inspiring. “So often his answers related to ethical behavior and a reminder to focus on the important things—success in business is not always about how much money you’ll make on the next deal.”

In addition to the Q&A session with Buffett, the Whitman and Cornell students enjoyed site visits to two of Berkshire Hathaway’s legendary retail subsidiaries. The first stop was a tour of the Nebraska Furniture Mart with executive vice president Bob Batt. His grandmother, Rose Blumkin, founded the store in 1937. Her simple tenet was to "Sell cheap and tell the truth." So impressed with her success and integrity, says the company Web site, Buffett used a simple handshake with Mrs. Blumkin in 1983 to close a famous $60 million deal purchasing 90 percent of the business, saying: "I would rather have her word than that of all the Big 8 auditors . . . it's like dealing with the Bank of England."

In the afternoon they visited Borsheim’s Fine Jewelry, which began as a family business in 1870 and is today the largest independent jewelry store in the nation. President and CEO Susan M. Jacques treated the visitors to a tour of the 62,500 square foot retailer. “Visiting Berkshire Hathaway subsidiaries was a value-added part of the trip,” says Angad Rajpal ’07 MBA. “Everyone knows about Berkshire Hathaway, but how many know too much about its subsidiaries? These tours, both led by senior executives, spoke volumes about the parent company’s strategy and Buffett’s insistence on quality management and involvement from the top.”

“It was easy to tell both companies had roots as family businesses,” Saks observes. “There was a clear emphasis on relationships with customers and improving the customer experience. You could see in microcosm Buffett’s investment philosophy at work. Even though he didn’t necessarily know the industries when he invested in these companies decades ago, he knew that because the management team and the culture were customer-focused and margins were good, everything would work out.”

Mr. Buffett is known for taking his top investors and high-profile visitors to his favorite Omaha steakhouse, Gorat’s, which is where Buffett treated his Whitman visitors to lunch. Jordan Barker was one of 11 students who dined at Mr. Buffett’s table and enjoyed his wonderful stories. “He really has a great sense of humor and is extremely down to earth,” says Barker ’07 BS. “You hear that about him, but until you meet him you can’t believe just what a normal guy he is. His time with us, though structured, was very loose and he made us feel like he had all the time in the world to spend with us.”

After lunch, as Mr. Buffett generously posed for individual and group photos outside Gorat’s, senior Lauren Tobias invited Mr. Buffett to drop by a pub where students planned to socialize after dinner. Buffett and his wife, Astrid, took them up on the offer, spending another several hours casually visiting with students that evening. “You traveled a long way to see me,” he noted, “I thought the least I could do is make an effort to see you.”

The trip to Omaha is emblematic of the experiential learning opportunities the Ballentine Investment Institute actively pursues for both Whitman undergraduate and MBA students. “From Wall Street trips to internships to ongoing contacts with investment professionals to managing real money as part of the SU Investment Club and the Orange Value Fund, the institute is giving Whitman students unparalleled opportunities to understand the markets and finance,” says institute director Fernando Diz, the Martin J. Whitman Associate Professor of Finance. “Spending time with Warren Buffett was an amazing learning experience for our students, and another notch in our quest to build our reputation as a program focused on value investing.”